#7 - What can you do if you are sued by a collection agency?
7. File for Bankruptcy
While bankruptcy often doesn’t make sense when you just owe a small amount of money, if the debt you are being sued for is large or if it is just one of numerous debts you owe, it may make sense to file for bankruptcy. When you do, you gain protection by the “automatic stay,” which will halt collection efforts against you.
Tip: If you are considering bankruptcy, it’s best to talk with an attorney as soon as you are served with notice of the lawsuit, rather than procrastinating until the day you’re due in court.
While dealing with a debt collection lawsuit, it’s still significant to watch over your credit scores, and to check your credit reports from time to time. Though your credit has taken a hit, observing your credit can alert you to new potential problems that you can work to resolve before they become bigger issues. You’re capable of retaining your free annual credit report from each of the major credit reporting agencies. You can monitor your credit scores for free using a tool like Credit.com’s Credit Report Card, which updates your scores monthly, and gives you an overview of your credit profile.
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